Kentucky’s horse industry is internationally known, but those who prefer sips to saddles have ensured that its Bourbons are a popular Bluegrass State export as well.
The numbers are certainly there: $3 billion in gross product, 10,000 direct and spin-off jobs with $442 million in annual payroll. Kentucky produces 95 percent of the world’s supply of Bourbon, with nearly 5 million barrels currently aging in the Commonwealth.
And with more than $100 million in planned and active capital investment, it’s an industry that’s ramping up to be even bigger.
Bourbon Business Expansion Plans in Kentucky
Among those increasing their production and operations in the state: Rare Breed Distilling is building a 20,000-space barrel storage warehouse at its Wild Turkey distillery in Lawrenceburg. The $2.3 million project will add to Wild Turkey’s storage capacity for its maturing whiskey products.
Sazerac North America is planning a combined $28 million expansion at its Owensboro distillery and the Buffalo Trace Distillery in Frankfort. The projects will add nearly 90 new full-time jobs in the Commonwealth.
Beam Global Spirits & Wine, which operates the Jim Beam distilleries in Frankfort and Clermont, will begin production in Frankfort of DeKuyper cordials and other spirits currently bottled outside of Kentucky. The move will result in the addition of about 120 new jobs and more than $28 million in technology upgrades at the Frankfort distillery over a two-year period.
“The $28 million plant upgrade in Frankfort is part of a current consolidation of our North American locations, but we have been continually expanding in Kentucky for the past three or four years,” says Jeff Conder, vice president of Americas operations for Beam Global. “We have invested about $70 million in warehousing and distillation capacity, increasing our Bourbon-making capacity in Kentucky by 50 percent.”
Beam has gone from 1.2 million barrels in storage to almost 2 million, much of which is dedicated to Bourbons requiring more time in the barrel, so it has ramped up production for both its four-year products, as well as those that require more aging.
“Kentucky is the nexus of our network, not only because we have increased capacity for Bourbon, but also because we’ve been able to bring into our facilities some of the products from recent acquisitions to be produced here as well,” Conder says.
Distillery Tourist Attractions, Centers Boost Economy
Many of the state’s new and existing distilleries have become tourist sites, as well as manufacturing centers, allowing the state’s signature industry to become an increasingly visible destination as well as an economic development juggernaut.
September in Kentucky is Bourbon Heritage Month, and the Kentucky Bourbon Trail® marked its 10th anniversary in 2009 with more visitors to its historic distilleries than ever before.
“In the past 10 years, Bourbon production has increased by more than 75 percent, and that has had an effect on tourism as well,” says Eric Gregory, president of the Kentucky Distillers’ Association. “And many of these distillers have spent millions to upgrade the visitors’ experience.”
As an example, he points to Maker’s Mark and its $3 million upgrade to their distillery experience that included a gourmet café and upgraded gift shop at its Loretto distillery.
“A lot of the expansion is geared around the tourism component, which has been skyrocketing,” Gregory says. “Since we opened the Kentucky Bourbon Trail, attendance has never gone down, and in 2009, we had more than 350,000 visits to the sites on the trail, with more than 3,000 people visiting all distilleries.”
The state’s willingness to pitch in with marketing and promotion has helped enormously, and Gregory credits economic development officials at all levels of government for capitalizing on the boom.
“Bourbon and Kentucky have been linked for centuries, and it’s known all around the world,” he says. “We’re growing jobs in the distilleries and in the related tourism industry and are having a tremendous financial impact.”